For the startup investing business mentioned in your question, there's another wrinkle to consider. If you're regularly investing in startups as your primary business activity, the IRS might classify you as a "dealer" rather than an "investor." This classification can dramatically change your tax situation - dealer transactions generate ordinary income/loss while investor transactions generally create capital gains/losses (which have different tax rates and limitations).

The key distinction you're looking for really comes down to timing and purpose. Business expenses are costs that benefit your business for one year or less and are deductible immediately. Investments (capital expenditures) are purchases that benefit your business for more than one year and must be depreciated over time. For your $135k example - if it's going toward salaries, rent, utilities, supplies, etc., those are current expenses that reduce this year's taxable income. But if you're buying equipment, real estate, or other assets with useful lives beyond one year, those are capital expenditures where you recover the cost through depreciation deductions over several years. The house-flipping scenario is interesting because it depends on your business model. If you're regularly buying, improving, and selling homes as your primary business, those properties are actually inventory (similar to a car dealer's vehicles). The purchase price and improvements become your cost basis, not immediate deductions. However, ongoing costs like insurance, utilities, and property taxes while you hold the property are typically deductible as business expenses. One important exception to watch for is Section 179, which lets you immediately deduct up to $1.2M of qualifying equipment purchases instead of depreciating them. This can be huge for cash flow if you're buying machinery, computers, or other business equipment. I'd strongly recommend working with a tax professional who understands your specific industry, as these distinctions can significantly impact your tax liability.

As someone who's been through a similar experience, I want to emphasize that what you're describing is NOT normal and you shouldn't accept it as "just how the industry works." I started at a firm with minimal training 5 years ago and made the mistake of thinking it was my fault for not picking things up fast enough. The reality is that tax work has serious consequences - we're dealing with people's financial lives and potential penalties/audits. Any firm that doesn't prioritize proper training is being irresponsible with both their staff and their clients. A few practical suggestions while you're in this situation: - Ask your supervisor for specific written procedures for common tasks - Request to shadow experienced staff on complex returns before doing them solo - If they refuse additional training, document these conversations for your own protection The tax software issue is particularly concerning - most reputable firms provide software training as a bare minimum. Consider reaching out to the software vendor's support team directly; many offer free training webinars for users. Start your job search now but be strategic about timing. The accounting world is smaller than you think, and how you handle this situation will follow you. When interviewing, ask detailed questions about training programs - good firms will have structured answers and won't be offended by the question. You deserve better than this, and there are firms out there that actually invest in developing their people properly.

This thread has been incredibly eye-opening and validating. I'm dealing with a similar situation at a smaller CPA firm where I started two months ago. Like the original poster, I was basically given a desk and told to "figure it out" during my first week. What's been most frustrating is that when I do ask questions, I get responses like "just do what we did last year" without any explanation of WHY certain decisions were made or what regulations we're following. I've been making errors on returns and then getting criticized for not being "detail-oriented enough" when the real issue is that I don't understand the underlying concepts. The resources mentioned here (especially the software vendor training) are things I never would have thought to pursue on my own. It's concerning that firms aren't proactively offering these basic supports to new hires. I'm definitely going to start documenting my requests for training and the responses I receive. Has anyone had experience bringing up these training deficiencies during performance reviews? I have one coming up next month and I'm trying to figure out how to advocate for better support without sounding like I'm making excuses for my mistakes.

This is such a thoughtful way to handle your stepchild's survivor benefits! I went through something similar when my sister passed and I became guardian of her two kids. A few practical tips from my experience: When you open the CDs, bring your stepchild's Social Security card and specifically tell the bank representative that this is a custodial account funded with the child's survivor benefits. Ask them to read back to you exactly whose SSN will be the primary tax ID on the account - this saved me from the reporting headache others mentioned. Also, keep detailed records of where the money comes from (survivor benefits) and what it's used for. I created a simple spreadsheet tracking the monthly survivor benefit deposits and any transfers to CDs or other investments. This documentation was really helpful when I had questions about dependency status and support calculations. One thing that surprised me was that some banks have special "Representative Payee" account types specifically for people managing Social Security benefits for others. These accounts are designed to keep the beneficiary's funds separate and ensure proper tax reporting. You might want to ask if your bank offers this option. The dependency and tax credit questions you're asking are exactly the right ones - it shows you're being really careful about doing this properly!

I'm dealing with a very similar situation with my stepson's survivor benefits, so this thread has been incredibly helpful! One thing I learned from our tax preparer that might be useful - even though Social Security survivor benefits don't count toward the support test for dependency, you should still keep records of how much you're actually spending on your stepchild's care (food, housing, medical, etc.) versus the amount of their survivor benefits. The IRS can sometimes look at the total picture if there are questions, and showing that you're providing the majority of their actual support (even though the benefits don't count against dependency) can strengthen your position for claiming them as a dependent. Also, regarding the FAFSA question - I found out that if the custodial account is properly set up with the child as the beneficiary, it typically won't count as a parent asset for OTHER children's FAFSA applications. However, when your stepchild eventually applies for FAFSA themselves, those CD accounts will count as their asset, which could potentially affect their aid eligibility. Something to keep in mind for long-term planning. The Representative Payee account option mentioned by Anastasia sounds like exactly what you need to keep everything properly separated and documented!

maybe a dumb question, but why does every bank check the FATCA box if most people dont have foreign accounts? seems weird that they would check a box that doesn't apply to most people and then it confuses everyone.

I had the exact same confusion last year! The FATCA checkbox on your 1099-INT is completely normal and doesn't mean you need to do anything special. It's just your bank (Capital One) certifying that they've followed federal reporting requirements - think of it like a stamp that says "we did our paperwork correctly." When TurboTax asks about foreign accounts, just answer honestly that you don't have any. The software sees that FATCA box and runs through its standard questions to be thorough, but for a regular US savings account, you can safely click "No" to foreign account questions and continue with your filing. Your $215 in interest income just gets reported as regular interest income - nothing fancy required. The FATCA thing is between your bank and the government, not something you as the account holder need to worry about at all.

Thanks everyone for all the helpful advice! I wanted to give you an update on my situation. I finally received my CP12 refund yesterday - exactly 7 weeks from the April 22nd notice date, so a bit longer than the 4-6 weeks they promised but not too bad considering how backed up the IRS has been. I took several pieces of advice from this thread. I used the "Where's My Refund" tool that CosmicCaptain mentioned, which helped me track the progress. I also started implementing Ava's suggestions about documenting my farm business activities more thoroughly - created a separate business account and started keeping better records of my marketing efforts at farmers markets. One thing that really helped ease my anxiety was understanding that the loss carryover from 2022 doesn't count as a new loss year for the hobby farm rules. I was really worried about that, but now I feel more confident about my tax situation going forward. Miguel's warning about potential follow-up notices is something I'm keeping in mind - I'm not spending the extra refund money right away, just in case there are any additional adjustments. Better to be safe than sorry! This community has been incredibly helpful. It's nice to know there are people who understand these complex tax situations and are willing to share their experiences.

Glad to hear you got your refund! Seven weeks is actually pretty reasonable given the current IRS processing delays. Your proactive approach to documenting your farm business is smart - especially keeping that separate business account and tracking your farmers market activities. Just wanted to add one more tip for anyone else dealing with farm losses: make sure you're tracking the time you spend on farm activities separately from any personal enjoyment of the property. The IRS looks for evidence that you're putting in serious effort to make the operation profitable, not just maintaining a hobby farm. Keep a simple log of hours spent on business activities like planting, harvesting, marketing, bookkeeping, etc. Also, if you haven't already, consider joining your local farm bureau or agricultural extension programs. Membership and participation in these organizations shows the IRS that you're treating farming as a legitimate business and staying current with industry practices.